The Operation of the Bretton Woods Institutions in the Modern Globalized Environment: Problems and Challenges

Abstract

Abstract The Bretton Woods institutions were founded in 1944. The World Bank would function as a development tool and the IMF would operate as a mechanism to prevent a new economic recession similar to that of the 1930s. As their main objective was to maintain global economic stability, they would work directed towards a dual role. The most important one was the diagnosis of creeping crises and their prevention, while the other was the direct and effective intervention in crises, when these could not be prevented. Over the years, the objectives of the institutions changed and their operation does not correspond to the formation of modern reality. In recent years, a debate has commenced regarding the effectiveness of the institutions and their role. The disharmony between the stated objectives and the practical implementation of programs has led to contradictions and inconsistent policies. This paper will examine the problems and challenges faced by the Bretton Woods institutions in the contemporary globalized world.